Substance OVER Symbolism -Oct 8

Oct 8, 2004

"A general dissolution of principles and manners will more surely overthrow the liberties of America than the whole force of the common enemy. While the people are virtuous they cannot be subdued; but when once they lose their virtue then will be ready to surrender their liberties to the first external or internal invader."

-Samuel Adams

Oct 8 -- EDITORIAL -- A recent Zogby poll of likely voters shows that 57 percent would like to see "other candidates" included in the presidential debates. And the democratic instincts of the American people are appropriate. When candidates are on enough state ballot lines to conceivably collect the Electoral College votes necessary to be elected, they ought to be included in the debates. That means, at this point, that Green Party candidate David Cobb, Constitution Party candidate Michael Peroutka, Libertarian Party candidate Michael Badnarik and independent Ralph Nader should be included. Some will suggest that including third party and independent candidates would make debates more confusing and inconsequential. But the experience from elsewhere - most other major democracies have traditions of far more inclusive debates - suggests the opposite. Multi-candidate debates stretch ideological limits, making ideas - rather than personalities - the driving force in the discussion. Regrettably, the Commission on Presidential Debates has not been open to openness. But there will be an opportunity to see some alternatives. PBS' "NOW With Bill Moyers," which will not air tonight because of the St. Louis debate, on Sunday will feature Cobb, Peroutka, Badnarik and Nader at 9 a.m. Our recommendation: Watch tonight's debate. Then tune in "NOW" Sunday morning to see what you missed because of the machinations of two big parties that maintain their bigness at least in part by rigging the rules in their favor.FULL STORY...

Take The World's Smallest Political Quiz to see where you fit in!

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"The Quiz has gained respect as a valid measure of a person's political leanings." - Wash. Post

MARKET NEWS DIGEST

The looming national benefit crisis
By Dennis Cauchon and John Waggoner, USA TODAY
Oct 4, 2004

The long-term economic health of the United States is threatened by $53 trillion in government debts and liabilities that start to come due in four years when baby boomers begin to retire. (Related graphic: U.S. economy threatened by aging of America)

The "Greatest Generation" and its baby-boom children have promised themselves benefits unprecedented in size and scope. Many leading economists say that even the world's most prosperous economy cannot fulfill these promises without a crushing increase in taxes — and perhaps not even then.

Neither President Bush nor John Kerry is addressing the issue in detail as they campaign for the White House.

A USA TODAY analysis found that the nation's hidden debt — Americans' obligation today as taxpayers — is more than five times the $9.5 trillion they owe on mortgages, car loans, credit cards and other personal debt.

This hidden debt equals $473,456 per household, dwarfing the $84,454 each household owes in personal debt.

The $53 trillion is what federal, state and local governments need immediately — stashed away, earning interest, beyond the $3 trillion in taxes collected last year — to repay debts and honor future benefits promised under Medicare, Social Security and government pensions. And like an unpaid credit card balance accumulating interest, the problem grows by more than $1 trillion every year that action to pay down the debt is delayed.

"As a nation, we may have already made promises to coming generations of retirees that we will be unable to fulfill," Federal Reserve Chairman Alan Greenspan told the House Budget Committee last month. (Related story: Americans' views on the benefit quandary)

Greenspan and economists from both political parties warn that the nation's economy is at risk from these fast-approaching costs. If action isn't taken soon — when baby boomers are still working and contributing payroll taxes— the consequences may be catastrophic, some economists say.

The worst-case scenario is a sudden crisis — perhaps a major terrorist attack or a shutoff of oil from the Middle East — that triggers a loss of confidence by investors in the U.S. economy. Foreign investors refuse to lend more money to the government to finance its deficits; drastic tax increases and benefit cuts occur suddenly; the dollar's value plummets, which raises the cost of imported goods; and a severe recession or depression results from falling incomes.

A softer landing: The USA acts swiftly and becomes more like Europe. Taxes are higher, retirement benefits are less generous but widely distributed; health care costs are controlled; and the economy is sound but less productive.

Big payments on the debt start coming due in 2008, when the first of 78 million baby boomers — the generation born from 1946 to 1964 — qualify at age 62 for early retirement benefits from Social Security. The costs start mushrooming in 2011, when the first boomers turn 65 and qualify for taxpayer-funded Medicare.

Key findings:

•Total hidden debt. Federal, state and local governments today have debts and "unfunded liabilities" of $53 trillion, or $473,456 per household. An unfunded liability is the difference, valued in today's dollars, between what current law requires the government to pay and what current law provides in projected tax revenue.

•Social Security. The retirement program has $12.7 trillion in obligations it cannot meet for current workers and retirees at the current Social Security tax rate.

•Medicare. The health care program has a $30 trillion unfunded liability for people now in the system as workers or beneficiaries. The $30 trillion reflects the value today of the more than $200 trillion in deficits over 75 years to cover current workers and retirees at existing levels of benefits, tax rates and premiums. Medicare's new prescription-drug benefit, which starts in 2006, accounts for $6.9 trillion of the program's financial ill health.

How much is $30 trillion? The gross domestic product, the entire economic output of the USA, was $11 trillion last year.

"These numbers are staggering in their magnitude," says economist Thomas Saving, whom Bush appointed as a public trustee on the Medicare and Social Security board. "But when I testify before Congress, I'm the only one saying, 'We have a funding problem.' Everyone else is testifying for more benefits."

Like a home mortgage

The $53 trillion in liabilities is like a mortgage balance: That's what it would cost to pay off the debt now. The actual cost would be higher because of interest payments. A $100,000 mortgage at 5% interest, for example, actually requires $193,000 in income to repay over 30 years.

Under corporate accounting rules, a corporation would record a $100,000 liability on its books if it promised to pay $193,000 in medical benefits over 30 years. That liability would reduce profits immediately, when the promise was made, although the money would be paid over 30 years. Otherwise, shareholders could be fooled into thinking that the company was better off than it really was.

In fact, the company had committed $193,000 in future revenue — worth $100,000 today — to a retiree and couldn't use the money for shareholder profits.

Government doesn't follow this accounting rule. If it did, the federal deficit in 2004 would be $8 trillion, not $422 billion. The $8 trillion reflects the value of new financial obligations Congress approved without any way to pay for them,plus the year's operating deficit.

Government accounting rules are more lenient because, unlike a business, Congress can take whatever money it needs through taxes and renege on promises by passing new laws. Theoretically, the president and Congress could end all health care for the elderly tomorrow and cease Social Security payments the next day — or double or triple tax rates to pay the bills.

FULL STORY

Related Stores:
Oct. 7 (Bloomberg) -- McTeer Says U.S. Trade Imbalance May Cause Rapid Dollar Fall -- The record U.S. current account deficit will lead to an inevitable decline in the value of the dollar, a drop that might be rapid and provoke a financial crisis, Dallas Federal Reserve Bank President Robert McTeer said. In a New York speech, McTeer said a precipitous drop in the U.S. currency would lead to a big jump in interest rates. He offered no easy policy solution, saying he "feels foolish warning about it" because "nothing bad has happened so far."
CAUTION: DEBT CRISIS AHEAD
SOCIAL INSECURITY: Research Report
Financial Terrorism: CITIZEN'S GUIDE TO COUNTER-TERRORISM

Oil Jumps to Record $53 on Winter Supply Concern

Oct. 7 (Bloomberg) -- Crude oil in New York rose to a record $53 a barrel after rising 14 of the last 16 sessions on concern that U.S. supplies will be inadequate to meet winter demand.

Hurricane Ivan has reduced production at platforms in the Gulf of Mexico, source of a quarter of U.S. output. U.S. inventories rose less than expected last week, and unions in Nigeria may strike, threatening shipments from the fifth biggest source of U.S. oil imports.

"The persistent shut-ins in the Gulf have been more severe and longer lasting than we thought at the time of the hurricane,"said Jim Steel, director of commodity research at Refco Inc. in New York. "The geopolitical concerns in Nigeria and elsewhere are just adding to the concern about supplies and the rise in prices."

Crude oil for November delivery was up 83 cents, or 1.6 percent, to $52.85 a barrel at 10:08 a.m. on the New York Mercantile Exchange after reaching $53, the highest since futures began trading in 1983. Oil futures were up 73 percent from a year earlier.

In London, the November Brent crude-oil futures contract was up $1.08, or 2.3 percent, at $49.07 a barrel on the International Petroleum Exchange, the highest price since the contract began trading in 1988.

Daily oil output at offshore platforms in the Gulf was down 478,126 barrels, or 28 percent, from the normal 1.7 million barrels at 12:30 p.m. New York time yesterday, according to the U.S. Minerals Management Service, part of the Interior Department. Ivan has reduced production 15.3 million barrels since Sept. 13.

Nigerian Strike

"I'm interested in seeing what the report shows today," said Aaron Kildow, a broker at Prudential Securities Inc. in New York. "Yesterday the report showed that more production was shut in. The situation isn't getting better."

A Nigerian oil workers' union said it will strike at midnight Sunday unless President Olusegun Obasanjo's administration cuts fuel prices. Oil workers joined a strike in June that didn't reduce oil exports.

"A geopolitical disruption, stronger demand for diesel or a cold winter will send us to $60," said Carl Larry, an associate director of energy futures at Barclays Capital Inc. in New York. "If none of these occur, we still aren't going below the $46 to $48 range because of limited supply."

http://www.bloomberg.com

BLACK GOLD STRANGLEHOLD -Craig R. Smith

Stocks can't shake U.S. payrolls blues
Economy creates fewer jobs than expected in September
By Mark Cotton, CBS.MarketWatch.com
Oct. 8, 2004

NEW YORK (CBS.MW) -- U.S. stocks traded lower Friday as an upbeat earnings outlook from General Electric failed to quell concern over the nation's economy after a weaker-than-expected employment report for September.

The economy added 96,000 jobs in September, the Labor Department reported. Economists polled by CBS MarketWatch had been looking for payrolls to rise by about 138,000. See full story.

The Dow Jones Industrial Average as last down 31 points at 10,094 after sustaining a triple-digit decline on Thursday.

Within the benchmark index, Intel as the biggest percentage decliner, falling 2.2 percent, in line with a pullback in the chip sector.

Merck fell another 0.9 percent on fears the drugmaker may face litigation over heart problems caused by Vioxx, its recently withdrawn arthritis drug.

The Nasdaq Composite Index tumbled 14.50 points, retreating to 1,933, after seeing a seven-session winning streak broken in the prior session.

Weakness in semiconductor stocks persisted even as key sector player and Intel rival Advanced Micro Devices posted results that met its lowered third-quarter financial targets.

A pullback in Internet stocks also weighed on the tech-rich Nasdaq.

Meanwhile, the S&P 500 index was down 3.90 points, at 1,126.70.

"We have a bit of a disappointment with the employment numbers, which came in lower than expected," said Peter Cardillo, chief market analyst at S.W. Bach. "But the report still shows the economy is adding jobs."

http://www.cbs.marketwatch.com

Gold surges to six-month high on jobs data -Reuters

NEW YORK, Oct 8 (Reuters) - COMEX gold futures rallied about 1.2 percent to a fresh six-month high Friday following a less-than-expected rise in U.S. September payroll jobs that undercut the dollar and boosted investment in the safe-haven metal.

"Today was just a function of the lower jobs number which really hurt the dollar. It was a no-brainer. Once you saw the currencies moving up, you had to just buy the metals," said Scott Meyers, senior trading analyst with Pioneer Futures.

U.S. nonfarm payrolls data for September showed 96,000 new jobs were created, below market expectations of 148,000 following 144,000 new jobs in August.

The unemployment rate remained 5.4 percent, as expected. The data were the last snapshot of how the labor market is faring before the Nov 2. presidential elections whose political uncertainty has unsettled financial markets.

December gold settled $5.00 firmer at $424.50 an ounce, after trading from $418.90 to $426.00, its highest level since April 12 when it was retreating from 16-year highs on the first of that month.

"From a technical perspective, it's a breakout. Could I see it head toward $430 in the short-term? Certainly. But I think that is going to be a function of whether or not today's number was a very meaningful event or just a one or two day affair," Meyers added.

Spot was last quoted at $422.45/3.20, after hitting a peak of $423.70 to mark its highest level since early April when prices came within 10 cents of January's 15-year peak at $430.50.

The euro gained 1 percent against the dollar, climbing above $1.2400 in the aftermath of the less-than-expected jobs report. Brokers looked for resistance in the euro at around $1.2435.

Recent weakness in the dollar, oil prices at near-record levels, instability in Iraq and uncertainty ahead of November's U.S. presidential election all have laid the groundwork for gold's recent rise.

December silver shot up 7.8 cents to finish the day at $7.295 an ounce after trading from $7.170 to $7.340.

Spot silver ended at $7.25/28, up from $7.16/7.19 at Thursday's close.

Related Story:
Commodities Index Rises to 23-Year High, Led by Oil and Metals -BLOOMBERG Oct 7 - Commodity prices measured by the Reuters CRB index rose to a 23-year high as oil and metal producers struggle to keep pace with increasing world demand for raw materials. ``We're seeing a restrained approach to adding new supply to the market by the companies, and demand is picking up significantly,'' Evy Hambro ...

Money trail behind Kerry's Iran stance -WND
Candidate has financial ties to backers of mullah regime
Oct 3, 2004

WASHINGTON – Sen. John Kerry's call for providing Iran with the nuclear fuel it seeks, even while the regime is believed to be only months away from developing nuclear weapons, is being linked to his campaign contributions from backers of the mullah government in Tehran.

During last Thursday's nationally televised debate between the Democratic presidential candidate and President Bush, Kerry insisted as president he would provide Tehran with the nuclear fuel it wants for a pledge to use it for peaceful purposes only.

"I think the United States should have offered the opportunity to provide the nuclear fuel, test them, see whether or not they were actually looking for it for peaceful purposes," Kerry said in a critique of the Bush administration's handling of Tehran's nuclear program, which the Iranians claim is only for civilian purposes.

The comments came in response to a question about whether diplomacy and sanctions can resolve the "nuclear problems" with North Korea and Iran.

"If they weren't willing to work a deal, then we could have put sanctions together," Kerry said of Tehran. "The president did nothing."

Among Kerry's top fund-raisers are three Iranian-Americans who have been pushing for dramatic changes in U.S. policy toward the Islamic Republic of Iran.

Most prominent among them is Hassan Nemazee, 54, an investment banker based in New York. Nominated to become U.S. ambassador to Argentina by President Clinton in 1999, Nemazee eventually withdrew his nomination after a former partner raised allegations of business improprieties, WND previously reported.

Nemazee was a major Clinton donor, giving $80,000 to the Democratic National Committee during the 1996 election cycle and attending at least one of the famous White House fund-raising coffees.

In 2001, at the invitation of Mobil Oil Chairman Lucio Noto, whom he counts as a "personal friend," Nemazee joined the board of the American-Iranian Council, a U.S. lobbying group that consistently has supported lifting U.S. sanctions on Iran and accommodating the Tehran regime.

The Kerry camp has identified Nemazee as having raised more than $100,000 for the senator's campaign, WND reported last spring.

http://www.wnd.com

COMMENTARY

Substance OVER Symbolism -Craig R. Smith
The Folding, Spindling & Mutilating of America's [Political &] Money System

"Kerry lost on substance, Bush on style. The big loser was the American people, who will no doubt be enamored by the skillful performance given by John Kerry, so much so that they miss the substance of his statements. Kerry showed the mark of a great con, the ability to make horrific statements in such a manner as to make them sound desirable."
-JB Williams, INSIGHT, 9-30-04

Imagine for a moment that you have the ability to create any amount of money, without ever having to produce anything.

Is there anyone or anything you couldn't buy? Probably not.

Sound impossible? It should be, but it isn't. Just ask your local Federal Reserve banker - they do it every day.

The folding, spindling and mutilating of America's monetary system became legitimized in 1913, when the Federal Reserve was formed. Long ago bankers discovered a nasty little secret referred to as "fractional-reserve banking" which is fueled by credit and debt creation out of thin air.

The modern American monetary system is the result of an incestuous relationship between the federal government and the private banking cartel, deceptively called The Federal Reserve System (a.k.a. "The Fed").

But don't expect the mainstream press or prominent political figures to ever discuss this relationship publicly. Sadly, few Americans understand the process, or even challenge the Fed's attempt to manipulate the money system.

In the two centuries prior to the creation of the Fed, unredeemable paper currencies were judged as unethical and immoral. As of 1792, they were deemed unconstitutional as well.

The fundamental misconception today is that America's paper or electronic currency, denominated in Federal Reserve Notes, is that a dollar actually has any intrinsic value.

In the words of former Fed economist John Exter, "Today’s U.S. dollar is nothing more than an IOU-nothing." Paper money retains only the symbol, or form, of its original substance - gold and silver.

Let’s now examine the untold story of how and why the U.S. dollar was transformed from substance (gold) to symbolism (debt) - and what you can do to recover the substance while you still have time.

Legal Plunder

As difficult as it is for honest, hard-working Americans to fathom, the lifeblood of the American political and economic system is legal plunder. The 19th-century economist Frederic Bastiat summed up the tendency of central governments to embrace economic plunder in this way:

"There are two ways to acquire the niceties of life: to produce them or to plunder them. When plunder becomes a way of life for a group of men living to- gether in society, they create for themselves in the course of time, a legal system that authorizes it and a moral code that glorifies it."

The gradual devaluation of U.S. currency during the 20th century reflects a more subtle transformation - too many Americans have abandoned the morality and economics of our Founding Fathers.

Today's warped and degenerate political system represents a marked departure from the statesmanship of a bygone era. Economics likewise has degenerated into a convoluted science orchestrated to conceal a colossal fraud perpetrated on an unsuspecting public.

FULL STORY - From Rediscoveringgold.com

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WHY A GOLD STANDARD NOW?
GOLD'S BIG PICTURE

After the gold rush -Mark Gongloff, CNNfn
Gold, and gold stocks, have enjoyed a rapid run-up since May. Do they have more room to run?
October 6, 2004
by Mark Gongloff, CNN/Money senior writer

NEW YORK (CNN/Money) - Confronted with a shaky U.S. dollar, soaring oil prices, sluggish stocks, and the ever-present threat of terrorism, investors have clamored lately for a commodity that's been a favorite pain reliever since the Stone Age: gold.

Earlier this year, the price of an ounce of the yellow stuff surged to its highest level in nearly a quarter-century, driven in part by the fear that impending inflation would weaken the U.S. dollar. When the world's most powerful currency falters, investors sometimes turn to gold to ease the sting.

Since May 10, as the dollar has lost about 4 percent of its value against a basket of other major currencies, the price of an ounce of gold has risen about 10 percent. And the American Stock Exchange's index of unhedged gold-mining stocks, or BUGS, has risen some 30 percent.

But a weak dollar may not be the only thing driving gold prices. As with every other investment that's enjoyed a hot summer, including oil and U.S. Treasury bonds, some observers smell a whiff of speculation in gold prices and think a correction is due.

Others point out that many people see gold as something to keep them warm at night in the face of impending doom -- after all, following a major disaster, either geopolitical or economic or both, gold will likely still have value, if only to accessorize post-apocalyptic Road Warrior outfits.

"We see gold not as a trade; we don't even look at it as an investment. We look at it as insurance," said Jean-Marie Eveillard, portfolio manager of the First Eagle Gold fund, which has nearly $600 million in gold and gold-related stocks and securities. "It's the ultimate hedge -- it tends to prosper in difficult times."

With that in mind, Eveillard said, First Eagle has put 5 to 7 percent of its separate global fund in gold or gold-related assets. What could go so wrong that they need such insurance? What could drive gold higher?

For one thing, there's always the chance that the dollar's decline could turn into a full-fledged rout, if foreign investors decide they've had enough of supporting America's wild deficit-spending binge. Oil prices could surge ever higher, slowing down the U.S. economy. Terror attacks could turn a slowdown into another full-fledged recession.

Eveillard said these are the kinds of disasters that would have to occur to drive gold much higher. But there may be other, more fundamental reasons why gold could stay strong in the longer term, too, even without a major disaster, according to Frank Holmes, CEO and chief investment officer at U.S. Global Funds, which includes the $62-million Gold Shares Fund in its family of funds:

* The U.S. dollar will almost certainly have to keep falling, according to most analysts, especially if China agrees to revalue its currency, as so many U.S. officials are pressing it to do.

* China has recently opened up a gold-trading market and allowed its consumers to buy gold, adding to the world's demand for the metal.

* A recent lack of spending on new mines, thanks in part to stiffer environmental regulation, has tightened the supply of gold.

* Even if the war in Iraq somehow ends fairly quickly -- which seems unlikely, at this point -- global military spending, oil prices and the threat of terrorism will still remain high, all of which are boons to inflation and to gold.

Like Eveillard of the First Eagle funds, Holmes says investors can't get rich trading gold or gold-related stocks, which rise and fall with the price of bullion. But he also recommends investors put 5-to-10 percent their money in gold and gold-related assets until the trouble for the U.S. dollar blows over -- which could take a while.

"Right now, we have negative real rates of return on Treasury bills and massive deficit spending," Holmes said. "Historically, a currency can't be strong with those two factors."

http://www.cnnfn.com

Related Story: Gold's BIG Picture

Immigration and Economic Terrorism -J. Thomas Lowry

October 4, 2004 - The vacuous claims that illegal immigration does not pose a significant threat to national security are ludicrous. At best, a new lower class is in the making where more tax dollars will make their way into programs to prop up this growing number. At worst, the terrorist cells that are a significant threat are roaming freely among the populace, aided by liberal, and in some cases, conservative apathy.

That a new lower class is being created is certain. The Mexican immigration, and refusal to assimilate into American culture, is hotly debated. One area and it is significant, where the progeny of Mexican immigrants are indeed assimilating is the public handout. The staggering numbers of those “on the dole” are reaching new highs according to statistics.

In addition, the dropout rate for Latino’s is higher than any other group. One might conclude that the reason we see Spanish everywhere, concurrent with English, is that little or no time, nor any effort, is spent on learning the language. This represents a clear and present danger for the future of America.

Heather Mac Donald is the Olin Scholar at the Manhattan Institute. Her groundbreaking work on many issues, including immigration, puts her in a unique position to comment on this issue. Mac Donald notes, "Hispanic parents are the kind of parents that leave it to others," explains an unwed Salvadoran welfare mother in Santa Ana. "We don't get that involved." Proponents of unregulated immigration simply ignore the growing underclass problem among later generations of Hispanics. When pressed, open-borders advocates dismiss worries about the Hispanic future with their favorite comparison between Mexicans and Italians.”

The problem in comparing Italian immigrants to the recent influx of immigrants is in the numbers. Thirty percent of the foreign-born population is Mexican while Italians made of only one seventh of the foreign-born population. In addition, and more importantly, there was a significant period of time whereby immigration was halted and Italians became assimilated into the culture. This is not true of the new underclass of Mexico.

Perhaps the most pressing issue is security. There is no moat around America and no drawbridge to crank upward to avoid an onslaught of terror. Simply put, at the current level of illegal traffic, a small Army could be forming. Consider the statistics.

The present number of illegal aliens is now roughly around ten million. Each year, some one million new illegal aliens are crossing our borders. Thus, the number of illegal aliens is larger than the population of New York City. Out of that number, what would be a safe estimate on the number who desire to do America harm? It would be significant.

FULL STORY

United may trigger biggest 'default' in history -CSM
Ailing airline may end all of its pension plans, creating the biggest default in US history and forcing a possible bailout.
By Alexandra Marks | Staff writer of The Christian Science Monitor

NEW YORK – Despite ongoing negotiations with its unions, United Airlines has told the bankruptcy court that the "likely result" will be a decision to terminate all of its pension plans.

That would precipitate the biggest pension default in history, more twice the size of the Bethlehem Steel Corporation default in 2002. The move is expected to destabilize the already struggling airline industry, prompting other old-line carriers like Delta to eventually follow suit to maintain competitiveness.

It would also put additional pressure on the Pension Benefit Guaranty Corporation (PBGC,) the federal agency that insures traditional pensions in case companies go belly up. It's already facing more than a $9 billion shortfall. A default by United would saddle it with an additional $8.4 billion in unfunded obligations. If other airlines follow, the PBGC may have to go to Congress and plead for a bailout that some experts say would be bigger than the Savings and Loan debacle of the 1980s.

More broadly, what all this means is that retirement for US workers just isn't what it used to be. Forget the gold watch and reliable pension check after 30 years of service. The impact of globalization and competition from low-wage companies that don't provide benefits has shifted the onus of retirement security from larger firms onto individuals.

Twenty years ago, 40 percent of American workers were covered by traditional pensions known as defined-benefit plans. Today that number's dropped to 20 percent. As the Bethlehem Steel and United examples show, even that 20 percent may not be able to count on what they've been promised. Currently, about 75 percent of those corporate plans are underfunded. "There are numerous threats to retirement in the future," says Brad Belt, executive director of the PBGC. "So it's incumbent on individuals to be well informed, prudent about their investments, and to save accordingly."

FULL STORY

Gold's geezers are pleased but patient -Peter Brimelow, CBS
CBSMarketWatch.com
Monday, October 4, 2004

NEW YORK -- Gold's powerful move to $420 last week tormented the technicians but left the gold geezers patient as ever.

One gold-skeptical chartist, Martin Pring, wrote in his Weekly Intermarket Update, "The gold price is now at important resistance in the form of the [$420.30] trendline. ... It stands a good chance of going through since the Gold Bugs Gold Share index has already broken out."

And an indubitable gold geezer, a veteran of the gold wars of the 1970s, Richard Russell of Dow Theory Letters, said last week that gold had "a bullish chart showing rising bottoms and rising tops" and that getting above $420 was "an important technical achievement."

On Friday, Russell added tersely: "Gold is giving up very little on the overbought corrections. Gold is not going out of style -- sit tight."

But Russell is still not getting excited. This has been a pattern with the gold geezers recently.

They've seen too much bloodshed since the great gold blowoff more than 20 years ago.

Russell still believes in gold in a very fundamental way. He wrote last week: "Gold is pure wealth -- it was wealth in 2000 BC, it was wealth in the 1400s and the 1600s, and it's wealth today. The people at the Fed may tell you that gold is just an ancient 'relic,' but gold will be accepted as wealth when these yo-yos at the central banks are gone and forgotten along with the whole unconstitutional Federal Reserve system and it's currency-printing operations."

That's fundamental, eh? But reviewing a number of gold stock charts, making the general case that their action suggests a gold rally, he was careful to note that some were overbought short-term. Thus he cited "Placer Dome, one of my favorites. I've long felt the PDG was a takeover candidate (think Newmont?) but for whatever reason the stock is taking off -- to the north. PDG has also entered the overbought zone, and for that reason the stock could be in for a 'rest.'"

Similarly, Harry Schultz of the International Harry Schultz letter told subscribers over the weekend: "Gold's main market story is: Bullion seems to have finished its correction and is preparing its assault on the April double-top 435 high. The 2-day close over 415 (basis December futures) is a technical victory for gold and will bring in a lot of chart buyers."

But Schultz doesn't seem to have changed his view that gold is in a $380-$430 trading range. He still says "take half profits at 427" and use squeaky tight [stops] on rest."

Schultz's latest letter contains an unusually direct assertion that the U.S. government is grooming the stock market, through purchases of futures contracts. But it says nothing (this time) about long-rumored official intervention in the gold market.

The leading advocate of this theory is Bill Murphy's LeMetropoleCafe.com Web site. This service seems to be alone in drawing attention to the current extraordinary increase in gold trading activity, which it reads as an effort to contain demand for gold with supply.

http://www.cbs.marketwatch.com

The terrorism - oil connection -Roanoke Times
October 03, 2004

Reducing U.S. dependence on foreign oil is an important front in the war on terror - but a front on which the Bush administration refuses to fight.

The per-barrel price of crude oil last week broke the $50 barrier - highlighting, among other things, one more front on which the Bush administration has failed to prosecute effectively the war on terror.

The immediate cause of the price spike was said to be unrest in the oil fields of Nigeria, seventh-largest supplier to the world and fifth-largest to the United States. But the deeper cause of the long-term trend toward higher-priced oil prices is rising global demand for the product. Among the elements of that demand is America's ever-increasing reliance on imported oil. Terrorism and oil have an intimate connection.

Petro-dollars funneled through Saudi Arabia, for example, provided funding for the rise of al-Qaida. Less directly, but no less important, U.S. thirst for oil is a key source of Islamist hatred of the West. To maintain supplies, the United States has long allied itself with unsavory regimes unable or unwilling to use their oil-export revenues to build broad-based economies and expand prosperity beyond the ruling elite. This breeds resentment, which sometimes takes lethal form.

Oil also appears to have played a role in tempting the Bush administration into its disastrous decision to shift attention from Afghanistan, which has no oil, to Iraq, which has plenty of the stuff. Iraqi oil revenues, or so it was asserted until grim reality intervened, would pay for military operations to oust Saddam Hussein and for post-Saddam national reconstruction.

Nigeria, though not in the Middle East, fits the general mold of unstable nation-states rich in oil resources but little else. Attempts at democracy have been fitful in Nigeria's 44 years as an independent country. It is riven by ethnic conflicts among tribes and by religious conflict between Christians and Muslims.

Neither a truce between government forces and the rebel militia - who are demanding that oil money be spread more widely among the impoverished inhabitants of the oil-producing Niger Delta - nor an outright government military victory is likely to bring permanent stability.

U.S. failure to come up with a coherent energy policy did not begin with George W. Bush. A more astute administration, however, would recognize that 9/11 was a call not only to arms but also for the United States to begin breaking the chains of its terrorism-generating oil addiction.

http://www.roanoaketimes.com

"Do business until I come…" Luke 19:13

We are now standing at the foundation-laying stage of one of the most significant Christian movements of church history, the advocacy of a Christian values-based economy. How we work with God’s Spirit in helping to lay that foundation will have potentially enormous effects on the global future of the church in the 21st century. It will also signal the emergence of an alternative to the world system’s left-right, capitalism-socialism single paradigm of economic possibility currently available to the nations of the world. The economics of God’s Kingdom is about to appear upon the world’s stage.

While some may call this emerging Christians-in-the-workplace movement a "marketplace ministries" phenomenon, such a definition is far, far too limited. This awakening of Christian economic theory and practice will do much more than merely legitimize the validity of believers working out a spiritual mission in the workplace. It has the clear potential of radically redefining historic economic theory and catapulting biblical Christianity out of the current stereotype of only concerning itself with sexual morals or abortion-related issues. As vital as those issues may be, they have only served to further isolate and "ghettoize" believers from touching the gears and levers of the economic mechanisms that drive the entire world. Indeed, in a world increasingly preoccupied with issues of economic lifestyle, job, and capital development, for believers to powerfully impact those issues is nothing short of major historic news. Beyond that, it will truly be an unexpected strategic "end run" around the current entrenchments biblical Christians now face in the world system’s marginalization of them.

While the majority of Christians often seem oblivious to the effects of their surrounding culture upon them, clear thinking Christian leaders must be highly aware of those forces and their ability to neutralize the vitality of historic Christian faith. Jesus said that man’s religious traditions have the startling ability to dilute the power of God’s word upon mankind. The world system’s values have trapped believers and unbelievers alike in a no-win vise between the values of capitalism and socialism with all its attendant liberal-conservative machinations. What now lies at our doorstep is the possibility to help break whole nations free of this destructive vise, especially Third World nations which are genuinely seeking alternatives to the First World’s economic corruptions and abuses.

Believers must do more than simply legitimize personal ministry in the marketplace. Only doing that will serve to "baptize" either capitalism or socialism in the process because we have failed to confront either alternative from a biblical point of view. Both Christ and history will then judge us for "missing the day of our visitation." Let us not miss that day either out of fear of the world system’s objections or the misguided hopes of fellow believers trapped in the desire to be "personally blessed and fulfilled" without addressing the needs of humanity which surround them.

Where We Now Stand ...FULL STORY

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David M. Bradshaw is Editor of Real Money Perspectives, publisher of Rediscovering Gold in the 21st Century: The Complete Guide to the Next Gold Rush (7/01) and has been an economic commentator since 1987, when he produced the World Economic Perspectives radio show. In 1997, he produced a one-hour TV documentary, "Preparing Wisely for the Next Millennium," which was distributed free of charge at Blockbuster Video nationally. In 1999, he produced a one-hour radio special, "The Big Picture: The Shape of Things to Come" discussing geopolitical, economic and spiritual trends in the 21st Century. MORE ... NOTE: Youngest daughter Braida Zoe (8 months) is learning the importance of having a crash helmet -- a valuable habit for us all to remember!